As the leader of a group of teachers, the principal of a school has a managerial task to perform. This would include the creation of an educational environment wherein effective teaching and learning can take place. Many of the principal's managerial functions are described in the literature, but the ideal school climate is not the result of purely organizational, administrative and supervisory management. Harmonious interpersonal relations are just as important. Meaningful education in schools can only take place if a congenial relationship between principal and staff exists. Where the principal and staff of a school are interdependent upon each other, sound relationships are essential. The principal should thus practice his style of management and leadership so as not to offend his staff. This would include characteristics such as empathy, respect, warmth and to be explicit in his manner. Furthermore, the personal characteristics of the principal as well as effective communication and motivation can promote job satisfaction and influence the creation and maintenance of interpersonal relations. Practice shows indisputable evidence that the importance of good personal relationships is of great importance in a people-oriented enterprise such as a school. Principals should thus also be sure to maintain a healthy balance between their people- and task orientated styles of management. The handling of conflict should take place in a manner which is not detrimental to the processes of teaching and learning. Conflict should therefore not be seen as only having a negative influence.